EU Law: Comment and Analysis

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Jobless EU migrants and housing benefit

According to reports from the BBC, ‘jobless migrants from within the European Union will be denied access to housing benefit from April this year’. Housing benefit is an ‘in –work’ benefit which provides support with rent for those who are unemployed or on a low income. As it is means tested, it may not cover all rent costs. It is administered through local councils to private and social landlords. Universal credit[1] will replace housing benefit in 2015. Before then, both Home Secretary Theresa May and Work and Pensions Secretary Iain Duncan Smith intend to introduce plans to ‘prevent exploitation of the UK welfare system’ by ‘jobless’ EU migrants.

Research[2] suggests that EU migrants are less likely than UK nationals to claim any form of benefits so the prevention of exploitation by targeting EU migrants is questionable. Furthermore, who are the jobless EU migrants – are they a composite group? Finally, as these measures will not apply to jobless nationals, would such action be compatible with EU law? There is indeed little free movement for jobless migrants under EU law[3] but when is an EU migrant ‘jobless’?

The ‘Jobless’

Focusing on the ‘jobless’ draws a broad distinction between this group and EU migrant ‘workers’: the former have few rights under EU law while the latter have many. Article 45 TFEU provides free movement to workers within the EU. A worker under EU law is a person who is employed: in Lawrie Blum and Collins the CJEUdefined a worker as a person who provides services under direction of another for remuneration. The work itself must constitute a ‘genuine economic activity’: in Steymann the provision of maintenance tasks for was seen as such whereas in Bettray work conducted as part of a rehabilitation scheme was not. The number of hours worked and level of salary are irrelevant to the definition.[4]

The Citizenship Directive (CD) adopted in 2004 guarantees migrant EU workers and other ‘qualified persons’[5] equal treatment with nationals in the territory of a host member state. Migrant EU workers benefit from non-discrimination on the grounds of nationality – they and their family members are to be treated in the same way as any national worker, in relation to work, education and access to benefits. Conditions for this equal treatment are set out in Chapter III of the CD.

In addition, under Article 7(2) Regulation 492/2011, a member state must provide migrant Union workers with the same social and tax advantages as national workers.[6] In particular,non-discrimination on the grounds of nationality in relation to housing is covered by Article 9 of Regulation 492/2011 which states that

A worker who is a national of a Member State and who is employed in the territory of another Member State shall enjoy all the rights and benefits accorded to national workers in matters of housing, including ownership of the housing he needs.

A worker may also put her name down on housing lists in the area of employment, enjoying the same right as nationals.

Rules that allow authorities to refuse benefits to non-nationals, when national workers in similar situations would receive them,[7] are contrary to Article 45, as are national rules that compensate recruitment agencies for placing unemployed persons in a job in the member state but not elsewhere. Neutral rules which place non-nationals and nationals who have exercised the right to free movement[8] at a disadvantage are also incompatible with Article 45. In Commission v Netherlands the CJEU stated:

37 …it should be noted that the equal treatment rule laid down both in Article 45 TFEU and in Article 7 of Regulation No 1612/68 [now: 492/2011] prohibits not only overt discrimination on grounds of nationality but also all covert forms of discrimination which, through the application of other criteria of differentiation, lead in fact to the same result.

Rules which are non-discriminatory can also infringe Article 45 if they act as an excessive hindrance or obstruction[9] to the exercise of free movement. Member states may not introduce rules that make it harder for migrant workers to satisfy eligibility criteria than national workers. It is irrelevant that the same rule might also operate to the detriment of some nationals. However, legislation that restricts the freedom of movement for workers can be permissible if it pursues a legitimate aim compatible with the Treaty and is proportionate.

When is an EU migrant worker ‘jobless’?

To describe an EU migrant as ‘jobless’ is to remove them from the protection provided by Article 45 TFEU, Citizenship Directive 2004/38 and Regulation 492/2011. The government may have a problem defining the relevant group – when is an EU migrant ‘jobless’? The jobless may share a common trait – absence of economic activity – but this is not a composite group. There are many routes to joblessness for an EU migrant – this group is more diverse than may be imagined. A jobless EU migrant may be somebody who a) has never worked at home or abroad; b) has worked at home but not in a host state; c) has worked in another host state but is jobless (perhaps due to study) in the current host state; d) has worked in the current host state and is now involuntarily jobless (thus a job-seeker) in the current host state; e) has worked in the current host state and is now voluntarily but temporarily jobless (thus not a job-seeker) in the current host state; or f) an EU migrant who has worked in the current host state and is now jobless and permanently unable to work in the current host state. A time element must be added to all of these scenarios: has the EU migrant been economically active, jobless or job-seeking in the host member state for 1) less than 3 months, 2) longer than 3 months 3) over 1 year or 4) over 5 years? Each route and duration of joblessness has different consequences under EU law. Introduction of a per se blanket exclusion from housing benefit to those who are ‘jobless’ could be problematic. The devil will be in the detail as some ‘jobless’ EU migrants remain protected under EU law.

For example, under Article 7(3) CD, a Union citizen who is no longer a worker or self-employed may nonetheless retain the status of a worker if after 3 months in a host state they become temporarily jobless due to illness or accident – the government will therefore infringe EU law if these ‘jobless’ EU migrants are refused housing benefit. The same applies to a ‘jobless’ migrant who has been employed for more than one year and formally registers as a jobseeker. The same also applies to a migrant who becomes ‘jobless’ during or at the end of a fixed term contract of less than 12 months and formally registers as unemployed. Finally, this article protects a migrant who becomes ‘jobless’ after starting vocational training related to the previous employment. Though out of work and ‘jobless’, they remain workers for the purpose of EU law and enjoy the protections guaranteed to workers. Furthermore, under Article 17 (1), permanent residents are not subject to the conditions laid out in Article 7 CD and other provisions on the right of residence. Therefore even if jobless, they enjoy a right to equal treatment.

Is ‘jobless’ a meaningful category?

It is therefore unclear how many EU migrants will fall into the category of ‘jobless’. This may, for example, apply to those who are voluntarily temporarily unemployed for reasons other than illness or accident – it is not clear if such persons will retain the status of a worker. The UK Supreme Court has asked the CJEU to answer this question in relation a migrant female worker[10] who stopped working due to complications in pregnancy. She applied for income support but was refused on the basis that she was voluntarily jobless and thus not a worker.

Although this situation is not clearly covered in Article 7(3) CD, it is recognized that would be a definite deterrent to the enjoyment of free movement rights of young female workers.[11] Also, as a national worker would not be subjected to such a choice, it is likely that as in Martinez Sala the CJEU will defend the right to equal treatment of non-national with national workers. This would be the correct decision according to AG Wahl:

A Union citizen residing and working in a Member State other than her own temporarily stops working because of the constraints of the late stages of pregnancy and the immediate aftermath of childbirth. She then applies for a special non-contributory cash benefit for a period of time during which women who are nationals of the host Member State are not required to work or actively to seek work. Her application is refused by the competent national authorities. In those circumstances, is she to be treated as a ‘worker’ for the purposes of Article 45 TFEU and, more specifically, is she covered by Article 7 of Directive 2004/38/EC (2) (‘the Citizenship Directive’)?

2. It is clear to me that this question ought to be answered in the affirmative. As I will try to illustrate below, any other construction of Article 7 of the Citizenship Directive would entail not only disregarding the principle of non-discrimination on grounds of nationality, but also the principle of non-discrimination on grounds of sex, both of which undoubtedly enjoy constitutional status in EU law.

It remains to be seen if the CJEU will agree with him. If so, then the restriction of housing benefit to those who are voluntarily and temporarily jobless may likewise be incompatible with EU law.[12]

In order to be compatible with EU law, the UK definition of ‘jobless’ will therefore have to be very tightly drawn. Which EU migrants are left? An obvious group comprises those EU migrants who are perhaps permanently unemployed and unemployable. Such a situation may arise if the person suffers from ill health, including mental ill health. Union citizens like Wadi Samin,[13] who due to a range of problems (long-standing clinical depression arising from traumatic experiences during service in the Iraqi army, high risk of self harm, diabetes, high blood pressure and gall stones) can no longer work will probably be an easy target. The rules are thus likely to affect only a small group, but this group will comprise the most vulnerable and those least able to help themselves. The Home Office has been accused of targeting the most vulnerable asylum seekers for deportation[14] – perhaps the plan is to adopt the same approach in relation to EU migrants.

[5] A ‘qualified person’ is a worker or self-employed person, a student , a jobseeker (up to 6 months) and any other self-sufficient person. Only ‘qualified persons’, permanent residents and those with derived rights have a right to reside beyond three months under Art 7 CD.